BOSTON and COLUMBUS, Ohio, July 12,
2021 /PRNewswire/ -- Liberty Mutual Holding Company
Inc. ("Liberty Mutual"), State Automobile Mutual
Insurance Company ("State Auto Mutual"), and State Auto Financial
Corporation (NASDAQ: STFC) ("State Auto
Financial") announced today that they have signed a
definitive agreement pursuant to which Liberty Mutual
would acquire State Auto
Group, a super-regional insurance holding company
headquartered in Columbus,
Ohio. Under the terms of the agreement, State Auto
mutual members will become mutual members of Liberty
Mutual and Liberty Mutual will acquire all of the
publicly held shares of common stock of State Auto Financial for
$52 per share in cash.
The acquisition will significantly expand Liberty Mutual's
position as an industry leader for personal lines and small
commercial insurance. Liberty Mutual today distributes
its Safeco Insurance personal auto, homeowners and specialty
products, and Liberty Mutual small business insurance through more
than 10,000 independent agencies countrywide. Through the deal,
Liberty Mutual will add $2.3 billion
in premium and State Auto's network of approximately 3,400
independent agencies across 33 states and is expected to
become the second largest carrier in this key distribution
channel.
"State Auto Group's capabilities and product expertise are an
ideal complement to Liberty Mutual's domestic personal lines and
small commercial business, and we welcome 2,000 talented associates
to our family," said Liberty Mutual Chairman and Chief Executive
Officer David Long. "Equally
appealing are its values. For almost a
century, State Auto has celebrated a culture of caring
for people, exceptional service and deep philanthropy,
mirroring our purpose to help people embrace today and confidently
pursue tomorrow."
The sixth-largest auto and home insurer in the US, Liberty
Mutual also offers multiple distribution channels to consumers for
its Liberty Mutual-branded products: through exclusive agents in
local sales offices countrywide,
licensed telesales counselors and online.
"The opportunity to join the Liberty Mutual organization is a
direct result of the incredible work of the State Auto team,
beginning with the transformation of our business and culture that
began in 2015," said State Auto President and CEO
Mike LaRocco. "We've become a digital provider of auto, home
and business insurance while remaining fully committed to the
independent agency system, as we've been since our founding 100
years ago. Our partnership with Liberty Mutual will further that
commitment to independent agents and contribute to the collective
success of our agents, policyholders, shareholders and
associates."
The transaction was approved by the State Auto Financial board
of directors (upon the recommendation of a special committee of
independent State Auto Financial directors), as well as the State
Auto Mutual board of directors (upon the recommendation of a
special committee of independent State Auto Mutual
directors). The deal is expected to close in
2022, pending State Auto Mutual member approval, State Auto
Financial shareholder approval, receipt of required regulatory
approvals and other customary closing conditions. In connection
with the merger of State Auto Financial, State Auto Mutual has
entered into a voting agreement with Liberty Mutual under which it
has agreed to vote its 58.8% interest in State Auto Financial in
favor of the merger.
Waller Helms Advisors LLC and Goldman Sachs & Co. LLC acted
as financial advisors and Skadden, Arps, Slate, Meagher & Flom
LLP acted as legal advisor to Liberty Mutual in the
transaction.
Houlihan Lokey Capital, Inc. acted as financial advisor and
Kirkland & Ellis LLP acted as legal advisor to the Special
Committee of Independent Directors of State Auto Financial in the
transaction.
Keefe, Bruyette & Woods, a Stifel Company,
and BofA Securities, Inc. acted as financial advisors and
Squire Patton Boggs (US) LLP acted as legal advisor to the Special
Committee of Independent Directors of State Auto Mutual in the
transaction.
About Liberty Mutual Insurance
At Liberty Mutual, we believe progress happens when people feel
secure. By providing protection for the unexpected and delivering
it with care, we help people embrace today and confidently pursue
tomorrow.
In business since 1912, and headquartered in Boston, today we are the sixth largest global
property and casualty insurer based on 2020 gross written
premium. We also rank 71 on the Fortune 100 list of largest
corporations in the U.S. based on 2020 revenue. As of December 31, 2020, we had $43.8 billion in annual consolidated
revenue.
We employ over 45,000 people in 29 countries and economies
around the world. We offer a wide range of insurance products and
services, including personal automobile, homeowners, specialty
lines, reinsurance, commercial multiple-peril, workers
compensation, commercial automobile, general liability, surety, and
commercial property.
For more information,
visit www.libertymutualinsurance.com
About State Auto Financial Corporation
State Auto Financial, headquartered in Columbus, Ohio, is a super-regional property
and casualty insurance holding company. State Auto
Financial common stock is traded on the NASDAQ Global
Select Market, which represents the top fourth of all NASDAQ listed
companies.
The insurance subsidiaries of State Auto Financial are part of
the State Auto Group. The State Auto Group markets its insurance
products throughout the United
States, through independent insurance agencies, which
include retail agencies and wholesale brokers. The State Auto Group
is rated A- (Excellent) by the A.M. Best Company and includes State
Automobile Mutual, State Auto Property & Casualty, State Auto
Ohio, State Auto Wisconsin, Milbank, Meridian Security, Patrons
Mutual, Rockhill Insurance, Plaza Insurance, American Compensation
and Bloomington Compensation. Additional information on State Auto
Financial and the State Auto Insurance Companies can be found
online at http://www.StateAuto.com/STFC.
Cautionary Notice Regarding Forward Looking
Statements
Except for historical information, all other information in this
communication consists of forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements, and related oral
statements State Auto Financial Corporation ("STFC") may make,
are subject to risks and uncertainties that could cause actual
results to differ materially from those projected, anticipated or
implied. For example, (1) conditions to the closing of the
transactions may not be satisfied; (2) regulatory approvals
required for the transactions may not be obtained, or required
regulatory approvals may delay the transactions or result in the
imposition of conditions that could have a material adverse effect
on Liberty Mutual Holding Company Inc.("LMHC"), State
Automobile Mutual Insurance Company ("SAM") or STFC or cause the
parties to abandon the transactions; (3) uncertainty as to the
timing of completion of the transactions; (4) the business of LMHC,
SAM or STFC may suffer as a result of uncertainty surrounding the
transactions; (5) the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement; (6) risks related to disruption of management's
attention from the ongoing business operations of LMHC, SAM or STFC
due to the transactions; (7) the effect of the announcement of the
transactions on the relationships of LMHC, SAM or STFC with its
clients, operating results and business generally; (8) the outcome
of any legal proceedings to the extent initiated against LMHC, SAM
or STFC following the announcement of the proposed transaction; and
(9) LMHC, SAM or STFC may be adversely affected by other economic,
business, and/or competitive factors as well as management's
response to any of the aforementioned factors. The foregoing
review of important factors should not be construed as exhaustive
and should be read in conjunction with the other cautionary
statements that are included herein and elsewhere, including the
risk factors included in STFC's most recent Annual Report on Form
10-K and Quarterly Report on Form 10-Q and other documents of STFC
on file with the Securities Exchange Commission ("SEC"). STFC
undertakes no obligation to update or revise any forward-looking
statements.
Additional Information and Where to Find It
In connection with the proposed transaction, STFC will file with
the SEC a proxy statement and may file or furnish other documents
with the SEC regarding the proposed transaction. This communication
is not a substitute for the proxy statement or any other document
that STFC may file with the SEC. The definitive proxy statement of
STFC will be mailed to the shareholders of STFC. INVESTORS IN AND
SECURITY HOLDERS OF STFC ARE URGED TO READ THE PROXY STATEMENT AND
ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED WITH OR FURNISHED TO OR
WILL BE FILED WITH OR WILL BE FURNISHED TO THE SEC, AS WELL AS ANY
AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN
THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED
MATTERS. Investors and security holders may obtain free
copies of the proxy statement (when available) and other documents
filed with or furnished to the SEC by STFC through the web site
maintained by the SEC at www.sec.gov or by contacting STFC's
investor relations department.
Participants in the Solicitation
STFC and its directors and executive officers and SAM may be
deemed to be participants in the solicitation of proxies from
STFC's shareholders in connection with the proposed
transaction. Information regarding STFC's directors and
executive officers, including a description of their direct
interests, by security holdings or otherwise, is contained in
STFC's Annual Report on Form 10-K for the year ended December 31, 2020 and its annual proxy statement
filed with the SEC on March 31, 2021.
To the extent holdings of STFC securities by directors or executive
officers of STFC have changed since the amounts contained in the
annual proxy statement filed with the SEC on March 31, 2021, such changes have been or will be
reflected on Statements of Change in Ownership on Form 4 filed with
the SEC. A more complete description will be available in the proxy
statement and other materials filed with or furnished to the SEC in
connection with the proposed transaction. You may obtain free
copies of these documents as described in the preceding paragraph
filed with or furnished to the SEC because they will contain
important information.
Media Contacts:
Glenn
Greenberg
617-574-5874
glenn.greenberg@libertymutual.com
Kyle
Anderson
614-477-5301
kyle.anderson@stateauto.com
View original content to download
multimedia:https://www.prnewswire.com/news-releases/liberty-mutual-insurance-bolsters-independent-agent-network-with-agreement-to-acquire-state-auto-group-301331422.html
SOURCE Liberty Mutual Insurance; State Auto Financial